SubscribeDaily Futures Commentary September 10, 2009
Thursday, September 10, 2009
The U.S. Dollar is expected to open higher against most majors this morning as demand for risk dropped overnight after European stock markets weakened. Economic news released last night and early this morning also contributed to movement in the foreign currency markets.
The U.S. Dollar has traded under pressure all week because of increased demand for higher yielding assets. Much of the rally has been attributed to the fact that the U.S. Dollar is currently the cheapest funding currency. Record low borrowing costs are contributing to the weakness in the Dollar and the strength in higher yielding assets. Investors have been selling the Dollar to fund their appetite for risk.
Yesterday the Dollar tried to regain some strength late in the trading session following the release of the Fed’s Beige Book but major buyers were noticeably absent driving the Dollar down into the close. The Fed reported in its monthly Beige Book that the U.S. economy was stabilizing or improving. This positive report was a strong sign that the worst recession in decades was over and that the economy may have turned the corner.
While the Fed …
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